Indians residing abroad cannot indulge in property business, says Chartered Accountant R. Bupathy, former President of the Institute of Chartered Accountants of India.
PROPERTY ACQUISITION, disposal and remittance in India are governed by the general and specific permission of the country’s Reserve Bank, and Indians residing abroad cannot indulge in real estate business, Chartered Accountant R. Bupathy, past President of the Institute of Chartered Accountants of India (ICAI), has clarified.
Bupathy was speaking recently during an event organised by the Abu Dhabi Chapter of the Institute of Chartered Accountants of India (ICAI), in the UAE’s Capital, which was attended by a 165 plus strong audience.
The main topics of discussions were; ‘Changes in Direct Taxation with reference to Non Resident Indians’ and ‘Unleash your Expo 2020 DNA’.
Bupathy expounded more on the provisions relating to India’s Foreign Exchange Management Act (FEMA), income tax and wealth tax. He talked about specific provisions relating to NRIs which affect property related transactions and new formalities that need to be completed. He also specifically talked about provisions affecting NRI senior citizens returning to India on retirement.
“Non Resident Indians (NRIs) / Persons of Indian Origin (PIOs) can acquire by purchase, gift or inheritance, immovable property in India other than agricultural land/ plantation/ farm house, under general permission,” he said, adding, “to acquire agricultural land, plantation and farm house prior permission of the Reserve Bank of India (RBI) is required, except by way of inheritance.”
Bhupaty mentioned that allincome generated in India except for the interest on NRE and Foreign Currency Non Resident (FCNR) accounts are taxable in India for a non-resident. To recover the tax on the income, the Government looks to tax deduction at source (TDS).
“It places an onerous responsibility on the payer to deduct and promptly deposit prescribed taxes on specified payments and file quarterly TDS returns. In the process, there is the necessity to obtain Permanent Account Number (PAN) to execute certain transactions,” he said.
“Failure in complying results in liability to interest, penalty and even prosecution,” he cautioned.
The Chairman of the Abu Dhabi Chapter, CA Padmanabha Acharya inaugurated the seminar by informing about some major activities the Chapter has planned for 2014. CA Acharya mentioned that with the falling rupee and economic climate in India, real estate purchases is on the minds of many NRIs, and therefore “an insight on the direct and indirect taxes applicable for property and clarification of the relevant rules and regulations would be of utmost use to all Non Resident Indians.”
Reg Athwal, who is an entrepreneur, advisor, angel investor and a motivational speaker, gave a talk on how to capture the potential entrepreneurial spirit in each one of us.
He gave life-changing examples from his own experiences, by introducing the acronym EXPO in a unique fashion to mean execution, removal of unwanted things, pioneering and outstanding. He went on to discuss what each of this entailed and gave practical tips of implementing each one of them.
Another concept introduced by Reg was the DNA profile of professionals who “should come together to form a highly successful and effective team.”
ICAI is the second largest professional accounting body in the world in terms of membership, second only to American Institute of Certified Public Accountants. The Abu Dhabi Chapter of the Institute of Chartered Accountants of India is now 28 years old and comprises of 600 members and is one of the most active chapters among 21 overseas chapters of the Institute.